Dogecoin’s NVT Ratio Suggests an Impending Upward Surge in the Coming Weeks
Dogecoin’s NVT ratio has been experiencing spikes, reaching all-time highs. The NVT ratio compares the network value to the transactional value, and a higher number suggests that the value being transferred on-chain is not keeping up with the network’s value. Dogecoin has seen four NVT spikes in the past year, with the fifth occurring at the beginning of this month.
In each instance, Dogecoin’s price initially dropped and then rallied back significantly. For example, when the NVT spiked on May 23, 2022, Dogecoin depreciated by 44% before rallying back by 58%. Similarly, on August 1, 2022, Dogecoin initially shed 8% of its value and then bounced back by 37%. The pattern remained consistent with the other spikes in December 5, 2022, and May 1, 2023.
Following the latest NVT peak registered on July 3, Dogecoin experienced a 7% correction. However, an uptrend has since begun, with Dogecoin rising by 8.2% a day ago and 0.5% so far today. Historically, the downticks have ranged from 33% to 44%, while the upticks have ranged from 37% to 58%. Based on this pattern, it is expected that Dogecoin’s price will continue to rise and eventually achieve double-digit gains.
It is essential to note that this analysis is based on historical trends and does not guarantee future price movements. However, it provides some insight into the potential behavior of Dogecoin based on its NVT ratio. Investors and traders may consider this information when making decisions about Dogecoin.